Google rivals to consider new antitrust proposals

By Edd Gent

Published Tuesday, October 29, 2013

EU regulators have asked 125 Google rivals to comment on the company's second attempt to settle an antitrust investigation.

The proposals are designed to end the three-year-long investigation and avert a possible $5bn (£3.1bn) fine, but the European Commission's hopes of closing the case next spring suffered a setback after several rivals said Google's latest offer was not materially different from one made in April.

The firm's original proposal was rejected by its competitors, who said the changes would only reinforce the company's dominance, which prompted the EU antitrust authority to demand fresh concessions from the US company.

The company tweaked its offer this month to allow rivals to display their logos and make their web links more prominent to users and it will also relax conditions that prevent advertisers from moving their campaigns to other platforms, such as Yahoo! and Microsoft’s Bing.

In areas where all search results can be paid advertisements, such as shopping searches, Google will cut the minimum bids it will accept from advertisers seeking to buy slots on result pages, to 3 cents from 10 cents.

Furthermore, Google's rivals will also have more control over what the company can copy from their websites in a practice known as scraping. Google is now proposing that its rivals, who had previously complained that Google copied content from their websites without permission, will decide which content the company can use.

Google has also agreed to appoint an independent trustee to monitor the process over the next five years.

"The Commission is sending today information requests," Antoine Colombani, the Commission spokesman for competition policy, said in an email yesterday.

"Information is sought, in particular, from complainants in the on-going proceedings and from all those who responded to the initial market test of Google's proposals, which the Commission launched in April."

Google said it had done its best to improve on its earlier offer.

"We've made significant changes to address the EC's concerns, greatly increasing the visibility of rival services and addressing other specific issues," Google spokesman Al Verney said. "Unfortunately, our competitors seem less interested in resolving things than in entangling us in a never-ending dispute."

Lobby group FairSearch, whose members include complainants Microsoft, online travel agency Expedia and British price comparison site Foundem, expressed doubts over the effectiveness of Google's proposal.

"It seems that no genuinely significant changes have been made to the initial proposal, so it is difficult to see how the new package can hope to solve the competition concerns Mr Almunia (the EU Competition Commissioner, Joaquin Almunia) has declared must be addressed," FairSearch lawyer Thomas Vinje said.

ICOMP, another lobby group that that counts Microsoft and four other complainants among its members, agreed.

"Google still doesn't appear to have offered anything that will prevent it from systematically preferencing its own services and manipulating results, a clear failure of the initial offer," said ICOMP lawyer David Wood.

Google could face a $5bn fine if the Commission decides not to accept its rejigged offer after the second market test but decides instead to charge the company with breaching EU antitrust rules.

The Commission has given the 125 rivals and third parties four weeks to respond to its feedback request.